87R8876 TYPED
 
  By: Blanco S.B. No. 856
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the appointment of a receivership for and disposition
  of certain platted lots that are abandoned, unoccupied, and
  undeveloped in certain counties.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  The legislature finds that:
         (1)  in the decades beginning with and following the 1960s,
  purchasers from all over the United States and elsewhere were lured
  by misrepresentations into buying lots in remote areas of the state
  with promises of future development;
         (2)  the lots in one such area comprised more than 50,000
  acres that have stood virtually undeveloped for more than 25 years
  after being platted;
         (3)  carving that area into lots as small as one-quarter
  acre, creating highly fractionalized and uneconomic real estate
  conditions, defeating any reasonable possibility of developing the
  lots, depriving the purchasers of the value of their investments,
  and effectively preventing installation of streets, water,
  sanitation, electricity and other infrastructure;
         (4)  in addition, the lots had, and have, in common an
  absence of water and electricity, substandard, if any,
  thoroughfares and no reasonable prospect that the lots can be
  developed for residential or commercial use;
         (5)  over the decades, the original purchasers have
  abandoned the lots, the purchasers cannot be located, or the
  purchasers died, in many cases leaving individuals representing
  multiple generations of families as holders of a complicated web of
  undivided interests in lots they may know nothing about;
         (6)  the lots are so lacking in value that local governments
  have either removed them from the tax rolls altogether, are unable
  to determine who owns them, or have found it uneconomical to collect
  the pennies in property tax revenue they may represent;
         (7)  in recent years, rapid residential growth has reached
  the areas adjacent to the lots, creating a substantial demand for
  residential properties that cannot be met due to the fractionalized
  nature of the properties and the absence of basic infrastructure;
         (8)  the lots are often used for illegal dumping of waste and
  hazardous materials and other purposes contrary to public health
  and safety; and
         (9)  it is necessary to establish a system by which the lots
  may be aggregated and re-platted in order to be able to return them
  to the market, provide for streets, water, sanitation, electricity
  and other infrastructure, and ensure that any future economic value
  that may be returned to the lots inures to the benefit of any owners
  and lienholders who can be located.
         SECTION 2.  Chapter 232, Local Government Code, is amended
  by adding Subchapter F to read as follows:
  SUBCHAPTER F. ABANDONED, UNOCCUPIED, AND UNDEVELOPED 
  PLATTED LOTS IN CERTAIN COUNTIES
         Sec. 232.151.  APPLICABILITY. This subchapter applies to a
  county with a population of more than 800,000 that is adjacent to an
  international border and contains more than 30,000 acres of lots
  that remain substantially undeveloped despite having been platted
  more than 25 years ago.
         Sec. 232.152.  ADMINISTRATIVE DETERMINATION. (a) In
  addition to the authority granted under Section 232.045, a
  commissioners court may implement an expedited process to
  administratively determine that a platted lot is abandoned,
  unoccupied, and undeveloped if the lot:
         (1)  has remained undeveloped for 25 years or more after the
  date the lot was platted;
         (2)  is part of a subdivision in which 50 percent or more of
  the lots are undeveloped or unoccupied;
         (3)  is part of a subdivision in which 50 percent or more of
  the lots are ten acres or less in size; 
         (4)  had an assessed value of less than $1000 as of January 1,
  2021; and
         (5)  as of January 1, 2021, was not valued for ad valorem
  taxation as land for agricultural use pursuant to Subchapter C,
  Chapter 23, Tax Code.
          (b) The county has no ownership interest in any lot that is
  administratively determined to be abandoned, unoccupied and
  undeveloped, or that is placed in a receivership under this
  subchapter, except for any existing or future legal interest
  established by other law.
         Sec. 232.153.  PUBLIC HEARING. (a) Before a county may make
  an administrative determination that a platted lot is abandoned,
  unoccupied, and undeveloped, the county must:
               (1)  hold a public hearing on the matter; and
               (2)  make reasonable efforts to notify each owner and
  lienholder of the lot of the time and place of the hearing as
  provided by Section 232.154.
         (b)  The hearing may be held by the commissioners court of
  the county or an appropriate county commission or board appointed
  by the commissioners court. The Texas Rules of Evidence do not apply
  to a hearing conducted under this section.
         (c)  At the hearing, an owner or lienholder may provide
  testimony and present evidence to refute any of the three required
  elements for a determination under Section 232.152.
         (d)  The county may conduct a single hearing for multiple
  lots and make a determination that multiple lots are abandoned,
  unoccupied, and undeveloped based on the same evidence.
         (e)  After the hearing, if a lot is determined to be
  abandoned, unoccupied, and undeveloped, the county shall within 14
  days issue an order of its determination.
         (f)  Within 14 days after the date of the order, the county
  shall:
         (1)  post notice of the order at the County Courthouse; and
         (2)  publish in a newspaper of general circulation in the
  county in which the lot is located a notice of the determination
  containing:
         (A)  a description of the lot;
         (B)  the date of the hearing;
         (C)  a brief statement of the results of the order; 
         (D)  instructions stating where a complete copy of the order
  may be obtained; and 
         (E)  notice that the order is appealable to a district court
  within the county within 60 calendar days of the order.
         (g)  In lieu of the notice required by Subsection (f), the
  county may publish a notice in a newspaper of general circulation in
  the county in which the lot is located that the commissioners court
  has adopted an order under this subchapter and direct the public to
  the county's website on which the information required by
  Subsections (f)(2)(A) through (E) may be found. 
         Sec. 232.154.  NOTICE OF HEARING. (a) The county shall:
         (1)  provide notice of the hearing to each record owner of
  the applicable lot and to each holder of a recorded lien against the
  applicable lot by:
         (A)  personal delivery;
         (B)  certified mail with return receipt requested to the last
  known address of each owner and lienholder; or
         (C)  delivery to the last known address of each owner or
  lienholder by the United States Postal Service using signature
  confirmation services;
         (2)  publish notice of the hearing in a newspaper of general
  circulation in the county on or before the 10th day before the date
  of the hearing and on the county's website; and
         (3)  file in the property records of the county notice of the
  hearing that contains:
         (A)  the name and last known address of the owner of the
  applicable lot; and
         (B)  a description of the administrative determination
  proceeding, including notice that the administrative determination
  may result in the extinguishment of any and all rights and legal
  interests in the lot.
         (b)  Notice under Subsection (a)(1) must be provided to each
  owner and lienholder for whom an address can be reasonably
  ascertained from the deed of trust or other applicable instrument
  on file in the office of the county clerk or in the records of the
  office of the central appraisal district for the county. The filed
  notice under Subsection (a)(3) must contain the name and address of
  each owner to the extent that that information can be reasonably
  ascertained from the deed of trust or other applicable instrument
  on file in the office of the county clerk or in the records of the
  office of the central appraisal district for the county.
         (c)  The filing of notice under Subsection (a)(3):
               (1)  is binding on subsequent grantees, lienholders, or
  other transferees of an interest in the platted lot who acquire that
  interest after the filing of the notice; and
               (2)  constitutes notice of the proceeding on any
  subsequent recipient of any interest in the platted lot who
  acquires that interest after the filing of the notice.
         (d)  An owner or lienholder is presumed to have received
  actual and constructive notice of the hearing if the commissioners
  court complies with this section, regardless of whether the
  commissioners court receives a response from the person.
         Sec. 232.155.  JUDICIAL REVIEW. (a) Any owner or lienholder
  of record of a platted lot aggrieved by an order issued under
  Section 232.153 may file in a district court in the county in which
  the property is located a verified petition alleging that the
  decision is illegal, in whole or in part, and stating with
  specificity the grounds of the alleged illegality. The petition
  must be filed by an owner or lienholder of the lot within 60
  calendar days of the order. If a petition is not filed within 60
  calendar days of the order, the order shall become final.
         (b)  On the filing of a petition under Subsection (a), the
  court may issue a writ of certiorari directed to the county to
  review the order of the county and shall prescribe in the writ the
  time within which a return on the writ must be made, and served on
  the relator or the relator's attorney. 
         (c)  The county is not required to return the original papers
  acted on by it, but it is sufficient for the county to return
  certified or sworn copies of the papers or parts of the papers as
  may be called for by the writ. 
         (d)  Appeal of the county's determination under this
  subchapter shall be conducted under the substantial evidence rule. 
         Sec. 232.156.  CIVIL ACTION FOR RECEIVERSHIP. (a) After a
  final determination that a platted lot is abandoned, unoccupied,
  and undeveloped, the county shall bring a civil action to have the
  lot placed in a receivership. Upon a final determination that a
  platted lot is abandoned, unoccupied, and undeveloped as provided
  by this subchapter, an owner or lienholder's rights and legal
  interests are extinguished, subject to the provisions of this
  subchapter regarding any net proceeds resulting from the
  disposition of the property, and transferred to the receiver.
         (b)  The only allegations required to be pleaded in an action
  for receivership brought under this section are:
               (1)  the identification of the applicable lot;
               (2)  the relationship of the defendant to the real
  property;
               (3)  the owner was given notice of the administrative
  hearing; and
               (4)  the lot has been administratively determined to be
  abandoned, unoccupied, and undeveloped.
         (c)  The court may appoint as receiver any person with a
  demonstrated record of knowledge of the problems created by
  abandoned, unoccupied, and undeveloped platted lots. In selecting a
  receiver, the court may also take into consideration whether the
  person owns property in the affected area. The court may not appoint
  as receiver the county, any county official or county employee or
  any relative of a county official or county employee within the
  third degree consanguinity or affinity.
         (d)  In a civil action under this subchapter, the record
  owners and any lienholders of record of the lot shall be served with
  personal notice of the proceedings as provided by the Texas Rules of
  Civil Procedure. Service on the record owners or lienholders
  constitutes notice to all unrecorded owners or lienholders.
         Sec. 232.157.  AUTHORITY AND DUTY OF RECEIVER. (a) Unless
  inconsistent with this chapter or other law, the rules of equity
  govern all matters relating to the appointment, powers, duties and
  liabilities of a receiver and to the powers of a court regarding a
  receiver. A receiver appointed by the court may:
               (1)  take control of the platted lot;
               (2)  make or have made any repairs or improvements to
  the platted lot to make it developable;
               (3)  make provisions for the platted lot to be subject
  to street, road, drainage, utility and other infrastructure
  requirements; 
               (4)  aggregate the platted lot with other lots that
  have been similarly determined to be abandoned, unoccupied, and
  undeveloped;
               (5)  re-plat the platted lot; and 
               (6)  exercise all other authority that an owner of the
  platted lot could have exercised, including the authority to sell
  the lot.
         (b)  Before a person assumes the duties of a receiver, the
  person must be sworn to perform the duties faithfully.
         (c)  The appointed receiver is an officer of the court.
         (d)  In the event a receiver dies, resigns or becomes
  incapacitated, the court shall appoint a receiver to succeed the
  former receiver.
         (e)  All funds that come into the hands of the receiver shall
  be deposited in a place in this state directed by the court. The
  receiver's use of the funds in connection with the receiver's duties
  or authority under this subchapter shall be subject to the approval
  of the court. All net proceeds from the disposition of a lot by the
  receiver shall be placed in trust and remain in trust for at least
  three years, unless claimed before the expiration of the trust
  period. The court must order such additional notices to an owner or
  lienholder about the net proceeds as are practicable during the
  trust period and, upon expiration of the trust period, any money
  remaining in the receivership shall escheat to the state. Funds
  escheated to the state pursuant to this subchapter are subject to
  disposition pursuant to Subchapters C and D, Chapter 71, Property
  Code.
         (f)  When the receiver has improved the platted lot to the
  degree that it is developable and meets all applicable standards,
  or before petitioning the court for termination of the
  receivership, the receiver shall file with the court:
         (1)  a summary and accounting of all costs and expenses
  incurred, which may, at the receiver's discretion, include a
  receivership fee of up to 15 percent of the costs and expenses
  incurred, unless the court, for good cause shown, authorizes a
  different limit;
         (2)  a statement describing the disposition of each lot,
  including whether the lot was aggregated with other lots;
         (3)  a statement of all revenues collected by the receiver in
  connection with the use or disposition of the lots; and
         (4)  to the extent required by the court, a description of
  any undivided interest of an owner or lienholder, whether
  identified or not, in the net proceeds from the disposition of the
  property.
         (g)  The court must approve any sale or lease of the property
  by the receiver.
         (h)  A receiver shall have a lien on the property under
  receivership for all of the receiver's unreimbursed costs and
  expenses and any receivership fee as detailed in the summary and
  accounting under Subsection (f)(1).
         SECTION 2.  This Act takes effect September 1, 2021.